Joshua Lim: Bitcoin’s divergence from gold creates market volatility, retail interest will drive price movements, and quantum computing poses risks for institutional investors.

Important takeaways

• The current levels of crypto prices are very low compared to previous highs.
• The strength of risk assets will determine the performance of the future crypto market.
• Bitcoin’s divergence from gold is causing market volatility.
• Bitcoin is facing downward trends while other risk assets are rising.
• The market is currently driven by income rather than fundamentals.
• Concerns about quantum computing are contributing to Bitcoin’s popularity among institutional investors.
• The crypto market is expected to remain under pressure this year.
• The market structure is healthy now due to low leverage and unsecured credit.
• The market tightens due to excessive pressure and speculation.
• Capital is expected to return to crypto when other speculative assets lose appeal.
• Crypto is increasingly seen as one of many asset classes.
• Retail investors have a significant impact on asset prices across all asset classes.
• Selling interest in Bitcoin is expected to return, driving price movements.
• The current market is characterized by money being recycled instead of new investment.
• Increased investor interest in crypto companies is likely as they explore real-world assets.

Guest introduction

Joshua Lim serves as Global Co-Head of Markets at FalconX. He co-founded the crypto derivatives trading company Arbelos Markets, which was acquired by FalconX in 2025. Previously, he led derivatives trading at Genesis Trading and Galaxy Digital after the initial equity exit at Goldman Sachs.

Historical price movements and market volatility

• “The current price levels of the crypto markets show a significant decline compared to previous highs.” – Joshua Lim
• “These levels are obviously worrying for anyone who has worked in this industry for a long time.” – Joshua Lim
• The future performance of crypto markets will depend on the strength of the risk asset.
• “It will be a function of how the risk assets hold up.” – Joshua Lim
• The split between Bitcoin and gold is causing instability in the crypto market.
• “This difference is very big and in particular, the big difference between Bitcoin and gold.” – Joshua Lim
• Bitcoin is currently experiencing bearish prices while other risk assets are trending higher.
• “Bitcoin is the only chart that is upside down while everything else is upside down.” – Joshua Lim
• The current Bitcoin market is driven by flows rather than fundamental catalysts.
• “It’s really a flow-driven market and what we’re seeing is more like a flow…flow into the more established asset classes especially gold.” – Joshua Lim

Institutional concerns and market forecasts

• The quantum question poses a major concern for Bitcoin, affecting its attractiveness to institutional investors compared to gold.
• “It’s a quantum question and that narrative … is complicated.” – Joshua Lim
• The crypto market is expected to remain in a limited position for a long time this year.
• “I think we’re going to be in a consistent market for a long time.” – Joshua Lim
• The current market structure is healthy due to the absence of excessive leverage or unsecured debt.
• “The market structure is very healthy for this.” – Joshua Lim
• The current market is going through a consolidation phase due to excessive momentum and speculation.
• “The market gained a little momentum and there was a lot more speculative enthusiasm.” – Joshua Lim
• Capital will eventually return to crypto as speculative assets such as stocks and commodities lose their appeal.
• “I think at some point all that money will go back into crypto.” – Joshua Lim

The idea of ​​crypto as an asset class

• Crypto is increasingly viewed as an alternative among various asset classes rather than the independent market.
• “It feels like crypto is part of the broader markets.” – Joshua Lim
• Gold and silver have experienced significant price movement, indicating a potential upside.
• “We had a very good 30% move and 15% move in silver and gold.” – Joshua Lim
• The retail investor has a significant impact on asset prices across different categories.
• “Which shows how much like merchandising drives commodity classes these days.” – Joshua Lim
• Selling interest in Bitcoin will return, leading to significant price movements.
• “I think if the retail mentality kind of comes back and focuses on Bitcoin you’re going to see things like that again.” – Joshua Lim
• The current crypto market is characterized by recycled funds instead of new investments.
• “A lot of the money moving from one token to another in crypto has just been reinvested in traditional crypto currency.” – Joshua Lim

Investment vehicles and market forces

• The proliferation of crypto investment vehicles has reduced attention and made it difficult for any single asset to attract significant new investment.
• “It’s hard for any one name to stand out and stand out and attract new inflows in a meaningful way.” – Joshua Lim
• Some investment vehicles will emerge as solid winners despite current market conditions.
• “It is inevitable that many of these will trade under nav forever … there will be strong winners.” – Joshua Lim
• There may be growing investor interest in crypto-related companies as they explore real-world assets and share purchases.
• “I think we’re going to get a lot of lead time ahead of what we’d like before that actually happens.” – Joshua Lim
• The appointment of Kevin Warsh as the chairman of the Fed is likely to create storms for risk assets, including crypto.
• “The first is and you know obviously the dollar is bullish so I think the general assumption is that this is going to be a challenge and a storm of risk assets.” – Joshua Lim

Market challenges and opportunities

• There is a lack of buy support in Bitcoin and other crypto assets due to concerns from the broader market.
• “What we are seeing today is similar to the lack of buy support in Bitcoin to other crypto assets.” – Joshua Lim
• Weak earnings reports and concerns in the AI ​​sector impact stocks, which in turn affect the crypto market.
• “You’ve seen some kind of weak revenue in some of these names that have come out and been reported.” – Joshua Lim
• Hype has become one of the most traded assets of crypto clients, serving as a safe haven for liquid crypto currencies.
• “The hype itself, the token and its platform volumes have been an extraordinary bright spot for crypto.” – Joshua Lim
• The growth in HIP-3 volume reflects a trend toward the creation of new permanent markets focused on real-world assets.
• “Most of the new creators are focused on real-world assets like stocks and bonds.” – Joshua Lim

Trading power and regulatory impact

• The revenue generated by trading Hyperliquid is significant, with costs accruing to the protocol and token holders benefiting.
• “Revenue is estimated at $4,000,000 per day.” – Joshua Lim
• DeFi is on the cutting edge of competition among centralized exchanges.
• “It looks like we’re at a point where DeFi is really competing with centralized exchanges.” – Joshua Lim
• The rise of platforms like Hyperliquid may lead to the spread of trading volumes from centralized exchanges to highly regulated venues.
• “On the rise of Hyperliquid… – Joshua Lim
• There is a growing need for transparency and accountability in crypto markets.
• “I think we are starting to see a greater need for transparency in order to be accountable.” – Joshua Lim

Technological advancements and future trends

• The rise of AI-driven commerce will benefit the Internet’s value transfer mechanisms, especially privacy-focused transactions.
• “I think it will be very beneficial to double the coins.” – Joshua Lim
• The development of privacy-enabled and compliant blockchains is an important area for innovation.
• “I think the most interesting area to build on is how to build these kinds of privacy-enabled blockchains in compliance with KYC and AML.” – Joshua Lim